Excerpt: - - if i fail so to pay i shall pay with interest at 8 annas per cent, per mensem the principal and interest to you or to your order on demand. every instrument so endorsed shall thereupon be admissible in evidence, and may be registered and acted upon and authenticated as if it had been duly stamped, and shall be delivered on his application in this behalf to the person from whose possession it came into the hands of the officer impounding it or as such person may direct: this law is well settled:.....for one of the suit amounts, namely, the amount due under exhibit j, called 'the promissory note bond' executed on the 25th march, 1921, by the father of the defendants. that 'note bond' was in renewal of a previous 'note bond' ex. h executed on the 8th september, 1917. the defendants' contention on the merits of the case is that both these notes are concoctions,, by the plaintiff and that they are therefore not liable to pay the amount claimed. they also raise a legal objection that ex. j is a promissory note, and that being insufficiently stamped it should not have been accepted in evidence by the lower court. the learned subordinate judge overruled both the contentions and gave a decree in favour of the plaintiff. on the question of law he held that the suit note is a 'bond'.....

Judgment:

Madhavan Nair, J.

1. Defendants are the appellants. In this appeal we are concerned only with the decree passed against the defendants for one of the suit amounts, namely, the amount due under Exhibit J, called 'the promissory note bond' executed on the 25th March, 1921, by the father of the defendants. That 'note bond' was in renewal of a previous 'note bond' Ex. H executed on the 8th September, 1917. The defendants' contention on the merits of the case is that both these notes are concoctions,, by the plaintiff and that they are therefore not liable to pay the amount claimed. They also raise a legal objection that Ex. J is a promissory note, and that being insufficiently stamped it should not have been accepted in evidence by the Lower Court. The learned Subordinate Judge overruled both the contentions and gave a decree in favour of the plaintiff. On the question of law he held that the suit note is a 'bond' within the meaning of the term under the Stamp Act. Accordingly he levied a penalty on the document and admitted it in evidence.

2. The document is in these terms:

On the 25th March, 1921, the promissory note bond executed in favour of Vitta Hussain Setti of Gadikota village by Peruma Reddi Bussa Reddi of Ravipadu village is as follows:--Under the note bond executed ere now on the 8th September, 1917, the balance found due as per accounts settled in person up to date is Rs. 5,080; I shall pay (this) sum of rupees five thousand and eighty with interest thereon at 7 annas per cent. per mensem, the principal and interest within a year from this date. If I fail so to pay I shall pay with interest at 8 annas per cent, per mensem the principal and interest to you or to your order on demand. Such is the pronote bond executed willingly of my own free will.

3. The first issue in the suit was whether the suit document, dated 25th March, 1921, is a bond or a promissory note. On this issue the learned Judge held, as already stated,

the document in question cannot be treated as a promissory note, but is to be treated as a bond. The issue is found for the plaintiff.

On the third issue, 'If a pronote, whether it is not invalid for want of proper stamp' the learned Judge held, 'if the document is to be taken as a pronote there can be no denying that it is invalid for want of proper stamp'. Having regard to the finding on the third issue the learned Advocate-General argues that it cannot be taken that the learned Judge has definitely found that the suit note is a bond and has admitted it in evidence as such. We cannot accept this argument' The finding on the third issue which is conditional cannot detract from the definiteness of the finding on the first issue. In our opinion the Lower Court has definitely found that the suit note is a bond and has admitted it in evidence levying penalty on it. This having been done, the question whether the suit note is a promissory note or a bond, which is really a debatable one, does not necessarily arise for decision, for under Section 36 of the Stamp Act

Where an instrument has been admitted in evidence, such admission shall not, except as provided in Section 61 (this exception does not apply to the present case), be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped.

4. In this connection attention may also be drawn to Section 42(2) of the Act. After referring to endorsement on instruments on which duty has been paid under Sections 35, 40 or 41, Clause (2) of Section 42 says:

Every instrument so endorsed shall thereupon be admissible in evidence, and may be registered and acted upon and authenticated as if it had been duly stamped, and shall be delivered on his application in this behalf to the person from whose possession it came into the hands of the officer impounding it or as such person may direct: Provided etc.

5. (The provisos do not apply to the present case.) Even assuming that the suit document is a promissory note, it having been admitted in evidence by the payment of a penalty its admission cannot thereafter be called into question. This law is well settled: see Ramasami Chetti v. Ramasami Chetti I.L.R. (1882) Mad. 220, Venkatrama Aiyar v. Chella Pillai (1920) 40 M.L.J. 479and Venkateswara v. Ramanatha : AIR1929Mad622 . The learned Advocate-General sought to draw a distinction, namely, that Section 36 does not apply to cases where the document in question forms the foundation for the suit but only applies to instruments admitted in the course of evidence in support of subsidiary points arising in the case. There is no authority in support of this distinction. We therefore hold that it is not now open to the appellants to argue that Ex. J should be rejected on the ground that it is a promissory note and was insufficiently stamped at the time of its production.

6. The next question relates to the merits of the case.

7. [His Lordship discussed the evidence and concluded:]

However these may be, the proved facts relating to the existence of the previous debt and its non-discharge, taken along with Ex. L, the reply to the suit notice and also with the admitted fact that the defendants have not produced the book which they say was kept by their father containing a list of his debts, strongly probabilise the truth of the plaintiff's case. These in fact form the true foundation for the learned Judge's decision.

8. The appeal fails and is dismissed with costs.

9. The memorandum of objections is allowed with respect to the costs disallowed to the respondent by the Lower Court but in computing the costs the amount of penalty paid on the document shall be shared in equal halves between the parties. In other respects the memorandum of objections is dismissed with proportionate costs.